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Crowdfunding an IPO with IPOVillage

After reflecting on the event at Crowdfund Texas, I have come to the firm belief that the upcoming IPO(s) from IPO Village will encourage movement on the rules that will ultimately govern equity crowdfunding. Equity Crowdfunding will bring about a new asset class that will have its own rules and regs from both the SEC.

For most, crowdfunding success isn't as easy as posting an offering and sharing it on a favorite social network. A successful offering takes careful planning and active management both during and after the campaign. In this crowdfunding how to guide, I'll outline the process and share tips and tricks according to the founders of IPO Village and ProHatch, two leading crowdfunding web sites.

With the passage of crowdfunding earlier this year, a whole new realm of capital formation for entrepreneurs and investors was realized. And now that sections of the JOBS Act will be passing in January of 2013, the first equity-based crowdfunding offer will soon be hitting the market, allowing small businesses to raise capital by selling equity to the public. However, with so many crowdfunding platforms now in the market, it’s important for entrepreneurs and investors to understand which sites are the most reliable and credible so that everyone can crowdfund responsibly.

When equity-based Crowdfund investing first came on the scene earlier this year, there was talk of how it might possibly “crowd out” venture capitalists. While historically venture capital firms and angel investors have been the dominant force in early stage financing for startups, Crowdfund investing, legalized by this year’s JOBS Act, is yet another funding mechanism that will bring a whole new class of investors into the capital markets. Under the law, entrepreneurs will now be able to raise capital via Crowdfund investing (CFI) up to $1 million annually, and unaccredited investors may invest up to $2,000 of their own money in these new ventures.

During the past twelve months we’ve seen (and heard) a great deal of conservation around crowdfunding and what it has brought to an exploding entrepreneurship community. As it’s brought life to numerous new projects while offering entrepreneurs an additional outlet for receiving funding. Crowdfunding isn’t something new, however in the world of startups its brought new opportunities of funding that once weren’t available. Some saw the expansion as a thread to the traditional methods of venture capital. Though little they know, that (most) Venture Capitalist have been just as excited about crowdfunding as the rest of us. Even recently it’s been made known that the Funders Club (a crowding website), raised $6 million in VC funding. While other VC’s are working on building their own crowdfunding websites.

HOW many fresh ideas and noble initiative should disappear because there is no funding. We often see it, maybe even we've never been part of that effort. But there is good news for all of us. Try to go to this sites www.ipovillage.com, then you will feel there is a 'breath of fresh air'.

This week I’ve polled a variety of people with experience in crowdfunding to identify the secrets for success for social entrepreneurs. I’ve talked to people who’ve tried to raise money using crowdfunding and have raised absolutely nothing. Others have been blown away by the generosity of their friends, neighbors and social network, raising more than they hoped or expected.

Imagine you’re a small business that’s wanting to raise (A LOT) of capital from potential investors. In the past, there were strict regulations, mounds of paperwork and an uphill battle in trying to find people that would actually invest into your company.

Following the publication of the October 2012 newsletter, we received a request from IPO Village to allow a reprinting of our interview with First Line Capital Managing Partner Daniel Hirsch. We agreed to allow a reprinting, but requested that they wait until at least a week after publication so that our Buckaroos had a chance to see the article first.

Learn how you–yes, you–can get in on an IPO offering from a variety of exciting new companies. Lauren chats with Daniel Hirsch, managing partner of First Line Capital, the company behind IPOVillage.com

Sometime early next year, the Securities and Exchange Commission is expected to propose rules that would pave the way for “equity crowdfunding,” harnessing the groupthink of social media as a tool for capital investment.

Fam Mirza, a young entrepreneur who has never let convention get in the way of a good idea, has launched a new watch company called 1:Face Watch that is a for profit business that promises to donate a portion of its revenue to one of six causes—each one associated with a color (think bright pink for breast cancer). I bought a white watch, feeding 16 people via One Day’s Wages.

The SEC has to give their stamp of approval all who signed up will receive their notice that the offering is is open for investment. The company's product uses ultra sound technologies for cellulite removal and I can almost bet if I searched a bit it's probably on this blog:)

IPO Village is a crowd funding platform company that hosts initial public offerings (IPO). IPO Village has recently received over $1 million in pledges for their first crowd funded IPO and it is set to go live in a few weeks. IPO Village is an organization that uses crowd funding to bring exclusive pre-IPOs to the everyday retail investor which would let "Main Street" investors access stock that was once only reserved for Wall Street companies.

Over $1 million in pledges has already been committed towards the first crowdfunded IPO (set ipo-village-clientto go live in the coming weeks) from investors intending to buy the shares in the IPO directly from the company. This process was enabled by IPOVillage.com acting as a portal, allowing interested investors to sign up for an opportunity to buy stock in the IPO on a first come, first serve basis. Moreover, this will be the first IPO to use crowdfunding since IPO Village does not even have to wait until the enactment of The Jobs Act (Jumpstart Our Business Startups Act, signed April 5, 2012) which created a new form of raising capital called crowdfunding) since the company is crowdfunding public offerings.

As the article mentions it is now in the quiet period and the name cannot be divulged. IPO Village was the portal that handled the crowd funding. image The company is not a start up and has been around for 6 years so I am guessing the IPO and crowd funding purpose was to ready the company for the IPO. The SEC has to give their stamp of approval all who signed up will receive their notice that the offering is is open for investment. The company's product uses ultra sound technologies for cellulite removal and I can almost bet if I searched a bit it's probably on this blog:)

Though crowdfunding is among the most new and innovative ways of financing, it has not reached throughout the world. However, those who have benefited from using it would certainly confirm that it is very easy and simple way of fund raising. It is done through a casual and informal method, where individual investors are approached to keep aside a compact portion of finance funds. It can likewise be called as donations or profit sharing. One of the most effective places for having innovative ideas with fund raising is usually online, through various crowdfunding platforms. It is significant to try a few other forms of crowdfunding tactics. If you are able to follow certain easy rules then certainly you can have the finance as a result of crowdfunding.

NEW YORK, NY — IPO Village, the first of its kind crowdfunding platform to host initial public offerings, announced today that they have received over $1 million in pledges for their first crowdfunded IPO set to go live in the coming weeks. IPO Village is an organization that uses crowdfunding to bring exclusive pre-IPOs to the everyday retail investor, allowing "Main Street" investors to access stock that was once only reserved for the Wall Street elite.

No matter what your career choice, it comes with some elements of a downside. For me as a technical author and journalist my career has kept me out of the stock market. It comes down to the appearance of impropriety. Writing about technology and technology companies ethically has kept me out of investing in these companies. It just wouldn’t do to be singing the praises of a hot company if I was also able to financially profit from the recommendation. Your morals may vary and I couldn’t see risking my reputation.

On September 25th 2012, I had the pleasure of presenting “When Crowded is Good: Power of Crowdfunding” at Innovation Studio 527, a monthly symposium around working towards solving complex problems. After that presentation, and attending the forum on “The Potential of Crowdfunding with CSI Toronto & Cdling,” it has been brought to my attention that there is an appetite for clarifying some of the crowd-language. This article is the second of a series I will be writing on crowdfunding.

For two days in a row an unsolicited email has shown up in my inbox. According to the email, a lot of you little folks — so-called "small time investors" — are fed up with getting shut out of IPOs. In fact, today's email contains this statement: "Small time unaccredited investors are tired of seeing all the hype about upcoming IPOs, yet always getting shut out," notes Daniel Hirsch, Managing Partner, First Line Capital.

I recently stumbled upon an article that caught my interest: "Mom/Pops finally get crack at new IPOs" (to read this article click here). The article discusses IPO Village, a crowdfunding business that specializes in bringing the IPO (Initial Public Offering) to "mom/pop investors"-in other words, individual investors.

Like Beluga caviar, investment in Initial Public Offerings is traditionally reserved for the wealthy elite. IPOVillage is changing all that (for IPOs, not caviar) by providing a platform in which companies use crowdfunding to raise the capital they need to go public.

Mom/Pop investors, the small unaccredited investors with no big broker affiliations, can now crowdfund new Nasdaq IPOs. Instead of getting shut out, Mom/Pops can invest and purchase modest amounts of equity or shares in qualified early-stage public companies commonly referred to as IPOs or Initial Public Offerings.

IPO Village, www.ipovillage.com, announces a strategic relationship with VStock Transfer, LLC, a New York based stock transfer and registrar company. VStock Transfer will act as the transfer and escrow agent for the IPO offerings hosted on www.IPOVillage.com

IPO Village, ipovillage.com , announced today that Howard Orloff has been appointed as Managing Director, or "Mayor" of IPO Village. "Howard brings a suite of skills to this position that is hard to find in one person. He was one of the pioneers in crowdfunding and has remained active in the field. He has a deep knowledge of Web 2.0 and how online communities run," Mr. Erblich said. "That he was willing to accept the task of running the village is just amazing."

A boutique investment bank is looking to open to the crowd the often opaque process of taking companies public.

First Line Capital has launched IPO Village, a site that allows regular investors to buy into initial public offerings at the kind of pre-open prices now reserved for investment banks' biggest clients and for institutional investors. The idea is to apply crowdfunding tools to IPOs.

First Line Capital is taking a cosmetic device company in the aesthetic medical field to the public markets. This firm's flagship system and patented technology has been on the international market for more than 6 years. Focused on developing innovative and safe solutions, the company meets the growing demand for cosmetic devices that help achieve and maintain a slimmer, firmer and more youthful appearance over time. FDA-cleared in the USA, and CE Medical Marked in Europe, more than 100,000 have been treated with outstanding satisfaction rates. The system is franchised in 13 countries with 130 installations and growing.

IPO Village reports that the public companies they will offer as crowdfunded IPOs are from the First Line Capital portfolio and not dependent on nor affected by the Jobs Act. In addition, IPO Village announced that a steady flow of retail investors are signing up ahead of the Company's first IPO. As the crowdfunding of IPO companies news continues to break, IPO Village is making more headlines and getting more publicity. A popular industry publication, Crowdfundng-Website-Reviews.com, recently increased IPO Village's site traffic ranking to four stars out of a possible five stars, a definite indication of the demand for greater access to IPOs.

In this latest installment of Crowdsourcing.org's From the Crowd podcast, Eric Mack speaks with Daniel Hirsch of First Line Capital, which is working with IPO Village to democratize the process of investing in IPOs and offering a means of using crowdfunding to open up initial public offerings on the Nasdaq exchange soon.

IPO Village launches website to offer crowdfunding of Nasdaq IPOs. Without prejudice or favoritism, retail investors can sign up for upcoming IPOs with any small investor participating in the next ground floor IPO investment opportunity. This new IPO strategy guarantees no favoritism. Shareholders receive free trading stock, liquidity and a clear exit strategy for investors.

Although crowdfunding is new to the capital markets as we get closer to the regulations that will guide equity crowdfunding in the US more experienced players are entering the marketplace. IPOVillage.com has knowledge of technology, social media and crowdfunding. They have taken this knowledge and partnered with an established investment banking firm, First Line Capital. With almost 2 decades of international investment banking success, the combination will be an immediate force in the newly established equity crowdfunding marketplace. With offices in the US, Israel and China expectations are high for some exciting technology companies to be brought to market by IPO Village and First Line Capital.